Question

Way Cool produces two different models of air conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and round "Cost per unit and OH rate" answers to 2 decimal places.) Process Components Activity Changeover Machining Setups Quantity 890 7,580 120 Finishing 5,400 Welding Inspecting Rework Overhead Cost Driver $ 454.000 Number of batches 301,800 Machine hours 227,500 Number of setups $ 983,3ee $ 181,700 Welding hours 227.000 Number of inspections 61,800 Rework orders $ 470, see $ 137, see Purchase orders 32,300 Number of units 60,260 Number of units $229,560 755 180 Support Purchasing Providing space Providing utilities 563 5,700 5,700 Additional production information concerning its two product lines follows. Model 145 1,900 2.200 Model 212 3,800 Units produced Welding hours Ratches

Answer 1

Solution: 1) Overhead costs=983300+470500+229560 Machine hours 222.08 per machine hour 1683360 7580 2) Overhead Assigned Model 145 Model 212 Total manufacturing cost per unit: Materials and Labor Overhead Overhead Total manufacturing cost Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit 2330 222.08 517446.40 1900 272.34 5250 222.08 1165920.00 3800 306.82 Model 145 Model 212 210.00 110.00 272.34 306.82 482.34 416.82 3) Market price Manufacturing cost per unit Profit(loss) per unit Model 145 Model 212 753.00 470.00 482.34 416.82 270.66 53.18